When will I receive my quarterly tax estimates?

Quarterly taxes 101

How we calculate your quarterly tax estimates

How to receive the most accurate quarterly tax estimates

How do I calculate my taxes manually?

If your onboarding is complete by the date listed below, you can expect to receive your estimate the month before the IRS due date.

If your onboarding is not complete by the date listed below, please click here to learn about the manual process

If you are unsure of your onboarding status, please email [email protected]

When you’re an employee, taxes are withheld from your paycheck, and these withholdings are applied to your final tax bill. As an S Corp, taxes are withheld from your paycheck for your salary, but these taxes don’t fully account for your S Corp’s pass-through profits. That’s where your quarterly taxes come in.

Every quarter, the government requires that you pay estimated taxes on those pass-through profits. Estimated taxes are due: April 15th, June 15th, September 15th (not for CA residents), and January 15th. If those dates fall on a weekend or holiday, the deadline moves to the next business day.

As a Collective member, you don’t have to worry about the hardest part of quarterly taxes- doing the math! We will take care of that for you. If you’re curious about how we crunch the numbers, here’s how we do it.

Our estimate is based only on your S Corporation activity, which means S corporation profit and the salary you pay yourself. We take your year-to-date business activity (income and expenses), year-to-date S corporation salary, and year-to-date tax withholdings from your salary and annualize these amounts to project your total taxable income for the year.

Annualizing means we use your year-to-date income to project the total amount of income for the year.

Example: You make $10,000 in S corporation profit in Q1 so by annualizing this number we predict that you will have $40,000 in S corporation profit for the year.

Once we have annualized your income and tax withholdings, we subtract your federal or state standard deduction, applicable qualified business income deduction, withholdings (tax you have already paid to the IRS and state), and any other tax payments you have made (and which you have informed Collective) to get your estimated tax payment.

Because these are estimates, we round the results to the nearest $100.

This calculation does not take into consideration any other income you receive throughout the year - such as interest, dividends, outside W2 income, or income from a business that is not included in your Collective membership. If you do have income unrelated to your S corporation, which does not have any tax withholding, we advise you to pay a larger estimate to cover the tax on that outside income.

Collective will not be liable for any underpayment penalty or interest resulting from not paying enough estimated taxes due to income generated outside of your S corporation.

Because your quarterly tax estimates rely on your revenue and expenses, it’s important that your bookkeeping is up to date. If you’re a few months behind on your bookkeeping, now is a good time to catch up.

Here are some other tips for accurate quarterly tax estimates:

If your onboarding is complete by the date listed below, you can expect to receive your estimate the month before the IRS due date. Click here to learn about the automated process.

If your onboarding is not complete by the date listed below, please read on to learn about the manual process.

If you are unsure of your onboarding status, please email [email protected]

Action

To manually calculate your quarterly tax estimate, please follow these steps. These steps are for a general rule of thumb and the accuracy will improve once you are fully onboarded. If you have any questions about these steps please email [email protected]: